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CIOs: Software prices headed higher, but priorities shifting

A Pacific Crest survey highlights how Microsoft stands to gain over the next three years, CIOs are seeing software price increases and decreases in maintenance and prepackaged apps are on the way.
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Written by Larry Dignan, Contributor on

Chief information officers are seeing software price increases, but spending on applications is a moving target as software as a service gains in popularity and prepackaged apps fall.

That takeaway was highlighted in a Pacific Crest Securities survey that highlighted how Microsoft was gaining wallet share over time.

The Pacific Crest findings roughly align with what ZDNet flagged in its IT strategic planning guide for 2015.

Within that view---CIOs planning for flattish budgets in 2015 with the percentage of respondents planning for increasing budgets falling to the lowest in five years---Microsoft has the most to gain over the next three years. The key points:

  • Maintenance contracts are the most at risk for budget cuts.
  • Amazon cloud adoption hasn't reached a tipping point, but is disrupting budgets.
  • VMware spending is holding steady.
  • Oracle and Cisco are garnering cloud attention among CIOs with budgets topping $1 billion.
  • Network and data security will see budget increases.
  • Storage will see a spending bump.
  • PCs are the most likely budget area to see a decline.
  • Prepackaged apps are out and so are the maintenance contracts that go with them.

When you look at the decreasing priorities among CIOs it's clear that both Oracle and SAP are likely to see pressure ahead along with hardware vendors.

Pacific Crest's survey of 63 CIOs delivered the following view:

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